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Which of the Following Are Generally TRUE of Bonds

Question 5

Multiple Choice

Which of the following are generally TRUE of bonds?


A) A bond's return equals the yield to maturity when the time to maturity is the same as the holding period.
B) A rise in interest rates is associated with a fall in bond prices,resulting in capital gains on bonds whose terms to maturity are longer than the holding periods.
C) The longer a bond's maturity,the smaller is the size of the price change associated with an interest rate change.
D) Prices and returns for short-term bonds are more volatile than those for longer-term bonds.

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